renting basement apartment in two family

Hi Looking at a two family house which has a fully finished basement apartment with kitchen and bathroom. The listing agent tells me it’s OK to rent the basement – making it a three family home – as long as you pay 3 family property tax. I never heard of such a thing. Any one knows what he is talking about? Seems like trouble to me – just wondering if there is a loophole I’m not aware of. thanks.

jackdavis100

in Real Estate - Rentals 13 years and 1 month ago

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digital1234 | 12 years and 10 months ago

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For the renting   apartment or the House , you must be a  certified  person  that place and the agents  provide  all the information about this   type  suggesstion ,   for the rent  house it orlando property management is the property  management   for the  property business , in the property  term the  investing of the money  maximum return the  profit.

apartmntkharkov | 13 years ago

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Looking for apartment in kharkov for single male. http://www.apartment-kharkov.com/

jstsrfn | 13 years ago

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Our house had the same situation – a two family with a renovated basement incl a bathroom and a kitchen.  The seller removed the stove in the basement kitchen for the inspection and then put it back in.  Closing went fine incl the mortgage.  We are, however, not renting it out.  I am sure it is done all the time, but we chose not to.  I do know that the jump from a 2 family to a 3 family in terms of regulations is steep.  A 2 family has essentially the same rules as a 1 family, but a 3 family needs a sprinkler system, fire escape, etc.

364house | 13 years and 1 month ago

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Conversion to 3 family is a multiple dwelling which subjects the buildings to ADA accessibility for the disabled and sprinkler requirements. DOB is also subjecting these conversion to fully sprinkler of entire building under the 2008 code. Prior to that you just had to put sprinklers in the public hall.

vladpinkh | 13 years and 1 month ago

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the RE agent is misleading you. its 100% not legal to rent a basement unless it has a CofO for a 3 fam. But Everybody does it, they just dont talk about it.  Rule of thumb for legalizing Basements, If it only takes 3 steps or less to get in your basement then you can legalize with no problem would cost about 3,500-5000 in paperwork plus another 10k to put a bathroom and kitchen. Good LUCK!

daveinbedstuy | 13 years and 1 month ago

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You will also run into more liability issue if there’s ever a serious problem like a fire and you don’t have sprinklers or fire escape with a 3 family

daveinbedstuy | 13 years and 1 month ago

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Yes, you first need to be in compliance with the C of O in order to get the mortgage.  No C of O, no problem but you’ll pay a higher rate for a 2 family over a 1 and a 3 over a 2.

callalily | 13 years and 1 month ago

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If the DOB says it’s a two family, you can’t get a mortgage unless you rip out the full bath and kitchen. Pay no attention to the tax class status. Only the DOB designation matters.

daveinbedstuy | 13 years and 1 month ago

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Go to the NYC BIS site and look for a certificate of occupancy.  If there is one you need to abide by what it states.  If there is not then it is open for interpretation.  But, as mike says, not everything is legal or illegal but there is definitely a distinction between a basement (“garden level”) and a cellar, the latter not legally habitable due to being >50% below grade, even if there are windows

mike-the-expeditor | 13 years and 1 month ago

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If you don’t have a certificate of occupancy that says it’s a three-family then you can’t rent out the basement. That says nothing for registering your building as a multiple dwelling unit or any of the other hurdles. In fact I wouldn’t even rely on your realtor’s representation that you could legalize your two-family home as a three family building. Unfortunately most real estate agents don’t know the (legal) difference between a basement and a cellar. You should find an architect or PE with experience in this area and see if this home can be legally converted.